Hog dealer fires workers after USDA levies fines
Associated Press
An influential hog dealer sanctioned twice for defrauding pork producers out of hundreds of thousands of dollars says it has fired employees responsible for its latest violations and paid restitution to affected sellers.
Lynch Livestock, based in Waucoma, also announced that pork industry veteran Dan Sutherland would lead the company going forward “as a further safeguard against future violations,” citing Sutherland’s experience in compliance matters.
Lynch announced those moves in a news release posted online Wednesday, after the Associated Press reported the U.S. Department of Agriculture had taken enforcement action against the company for illegal buying practices for the second time since 2017.
The company’s longtime owner, Gary Lynch, a political donor to Iowa Republican officials, hasn’t returned messages seeking comment.
In the release, his company said the USDA received a complaint in January that employees at its Waucoma buying station were manipulating the scale and issuing false tickets to artificially lower payments to producers.
Lynch said it investigated the allegations and terminated an unspecified number of employees who engaged in those practices.
“Although this situation arose due to the actions of a few employees at one buying station, we take this matter very seriously,” Gary Lynch was quoted as saying.
“We have already made great strides in establishing new processes and procedures to empower employees and ensure producers receive fair compensation.”
USDA said its investigation found the practices went on for three years, from January 2018 through 2020.
The agency ordered Lynch Livestock to pay $445,626 in penalties and restitution, and to stop recording false weights, altering classifications of hogs delivered and creating false scale tickets.
The company said restitution has already been sent to producers who were underpaid for their hogs.
The USDA had ordered Lynch to pay a fine and restitution and to stop the same practices in 2017, after an investigation found the company “willfully violated” the Packers and Stockyards Act.
Company employees arbitrarily lowered weights for delivered hogs, downgraded their classifications, fictitiously claimed dead hogs to lower prices and created false scale tickets to back up altered weights